Regional trade agreements and intelligent transformation of export manufacturing

Industry 4.0 is characterized by intelligence. This paper examines the impact of regional trade agreements (RTAs) on the intelligent transformation of manufacturing exporters by using a sample of Chinese manufacturing exporters. This paper finds that the entry into force of RTAs can promote the intelligent transformation of manufacturing exporters. This is because: (1) RTAs promote the export of manufacturing exporters, which need to undergo intelligent transformation to meet the demand of export growth; (2) RTAs facilitate the international knowledge spillover, which enhances the intelligent upgrading of high-tech manufacturing exporters; (3) RTAs increase the technological complexity of export products, which induces the intelligent transformation of low-tech manufacturing exporters. Heterogeneity analysis shows that the effect of RTAs on intelligent transformation is more pronounced for enterprises with foreign capital, low financial constraints, high resource allocation concentration, and high capital intensity of the product, and that this effect depends on low trade policy uncertainty. This paper offers new insights and empirical evidence on the role of trade in driving the intelligent transformation of manufacturing industries.